Kenya manufacturers decry disruptions caused by fuel price protests
By Mabonga Makhanu, May 19, 2026The Kenya Association of Manufacturers (KAM) has expressed deep concern over the ongoing protests by motorists rejecting the fuel price hike following the recent Energy Petroleum Regulatory Authority (EPRA) monthly review.
In a statement shared by the association on Monday, May 18, 2026, the organisation stated that the protests had gripped its operations.
It noted that, for manufacturers, the disruptions had resulted in interrupted operations, delayed production schedules, supply chain inefficiencies, and reduced productivity, ultimately affecting overall economic performance.
“For manufacturers, these disruptions result in interrupted operations, delayed production schedules, supply chain inefficiencies, and reduced productivity, ultimately affecting overall”, read a statement by KAM
KAM further expressed deep concern over the sharp increase in fuel prices announced by the Energy and Petroleum Regulatory Authority (EPRA) on May 14, 2026.
It reported that fuel prices had risen to Ksh214.25 for super petrol, Ksh242.92 for diesel, and Ksh152.78 for kerosene, the highest in Kenya’s history. It further noted that between March and May, the cost of fuel had increased by an average of Ksh80.
While KAM appreciated the government’s interim decision in April 2026 to reduce VAT on petroleum products from 16 per cent to 8 per cent as a measure to ease the cost burden on consumers and businesses, it observed that fuel prices continued to have far-reaching effects on the economy.
It stated that fuel directly influenced the cost of transportation, food production, agriculture, manufacturing, and the movement of goods and services nationwide, ultimately affecting the cost of living and the competitiveness of businesses.
The association added that, in the manufacturing sector, fuel was a critical input throughout the value chain, from the sourcing of raw materials to production and the distribution of finished goods.
It noted that Kenyan manufacturers heavily relied on Automotive Gas Oil (AGO), Industrial Diesel Oil (IDO), and Heavy Fuel Oil (HFO) in their operations.
It emphasised that access to affordable, reliable, and quality fuel was essential for sustaining industrial productivity and competitiveness.
It further stated that some manufacturers also used petroleum products directly in their production processes and that the rise in fuel prices would significantly increase both production and distribution costs across multiple sectors.
As a result, it warned that the prices of consumer goods were likely to rise. It also noted that the fuel cost component in electricity tariffs was projected to increase from Ksh3.47 per kWh, further increasing the cost burden on businesses and households.
Daily commuting
KAM observed that the impact was already being felt in the transport and logistics sector, where operators had recently increased fares nationwide and were expected to implement further increases in response to rising fuel costs.
It noted that this had made daily commuting increasingly unaffordable for many Kenyans, particularly workers who depended on public transport.
The association further stated that nationwide protests and work stoppages by public transport operators, which had left many citizens stranded and unable to report to work, had highlighted the severity of the situation.
It observed that, for manufacturers, these disruptions had led to interrupted operations, delayed production schedules, supply chain inefficiencies, and reduced productivity, ultimately affecting overall economic performance.
KAM, therefore, called on the government to urgently intervene and implement measures aimed at reducing fuel costs in order to cushion households, support businesses, and safeguard economic stability.
Scrapping of levies and taxes
It urged the government to consider reviewing various fuel-related taxes and levies to ease pressure on the economy and protect the competitiveness and productivity of local manufacturers.
It stated that such measures would play a critical role in lowering commodity prices, stabilising supply chains, and supporting broader economic recovery. It also emphasised the need to inject liquidity into the economy through targeted fiscal interventions.
KAM reiterated its commitment to working with the government and other stakeholders to identify sustainable solutions to the challenges currently facing businesses, consumers, and the economy at large.
Demand for action
It further noted that taxes and levies, including excise duty, VAT, the road maintenance levy, the petroleum development levy, the railway development levy, and the anti-adulteration levy, accounted for approximately 46 per cent of retail fuel prices.
It observed that this significant tax burden continued to exert pressure on manufacturers and Kenyan households, particularly amid a challenging economic environment marked by high taxation, rising operational costs, and increased cost-of-living pressures.
The association concluded that the country was facing challenging economic times driven by rising fuel costs and declining purchasing power.
It added that transportation of raw materials and finished products remained heavily dependent on diesel-powered vehicles, while some manufacturers also used petroleum products directly as raw materials, including in the production of resins and shoe polish.